The man was arrested without incident and taken to Auckland Central Police Station where he will be held overnight.

Police say it is likely he will be charged with firearms offences. He will appear in court on Tuesday.

''During the five hour ordeal the man asked to speak to a friend but the nominated friend was unable to be located,'' a police spokeswoman said.

''No shots were fired throughout the incident which was eventually resolved by direct negotiation.''

Police were earlier heard calling for the man to ''come out with your hands up and leave the gun behind" over a loud speaker.

Police then said: "We will send the dogs in and they will bite you. . . We are here to help you.''

Another voice called on the man to raise his hand ''if you can hear me''. ''Shaun, we need to finish this now."

Earlier in the evening, police negotiators and the Armed Offenders Squad (AOS) were in contact with the man by phone.

Ten children who were in lockdown in a Lollipops Educare centre in the building, along with three staff, were safely evacuated.

Earlier, teacher Maria Doudhat said the children ranged in age from one to five-years-old, and most of them had their parents in the centre with them.

Nine bank staff who were in the building were released unharmed during the afternoon and it is thought they were not directly threatened by the man, believed to be a 41-year-old who arrived at the bank in a wheelchair.

The District Commander of Auckland City Police, Mike Clement, told Radio New Zealand none of the bank workers had been directly threatened by the man.

Clement said the man was “known to the health system”, and police would take as long as necessary to resolve the situation.

An eyewitness, who was working in a neighbouring building and who asked not to be identified, said he was told by police to leave his workplace. “Through the window of the bank I could see the guy sitting down pointing a gun at his head.”

He said it was a handgun.

At first the witness thought the man was sitting on a couch, but then saw that he was in a wheelchair, which he was moving around the bank in.

He said that at about 5.50pm the staff walked out of the bank and around the corner of the building, to where police were waiting.

The area has been cordoned off since 4.30pm.

People working in adjacent offices were initially trapped inside their buildings and were told to stay away from the windows.

"There are commando people hiding in the bushes with guns," said Jacinth Gutla, a software engineer who worked on the floor above the bank.

"We are allowed to leave now. But advised to leave in groups and only though the exit on the opposite side of great south road," he said.

He could see two armed officers from his window that looked out onto Great South Rd from the Central Park building in Penrose.

"It's scary but exciting in a way," Gutla said.

Motorists are advised that Great South Rd is closed between the motorway on-ramp near One Tree Hill College and Rockfield Rd in Penrose.